This is the second major move to exit Asia in recent weeks, having divested itself of Telenor Pakistan in December leaving it with holdings in Bangladesh and Malaysia
After 25 years in Thailand, Telenor has agreed to sell its 24.95% stake in True Corporation for approximately NOK 39 billion (about €3.369 billion). The buyer is Arise Digital Technology Company Limited which is owned by Khun Suphachai Chearavanont (pictured above right) who is also the Chair of True.
The parties have agreed a mutual put/call option for the sale of Telenor’s remaining 5.35% holding two years after closing of the initial sale. The price will be the higher of THB 11.70 per share that Arise will pay in the initial transaction and the market price prior to the term of the option maturing.
Boosting the value of True
Telenor invested in TAC in 2000 which became dtac, one of Thailand’s leading operators. In 2023, dtac merged with True to form the new True Corporation listed on Stock Exchange of Thailand. At the time, it was Southeast Asia’s largest telecoms deal and created Thailand’s largest telecom tech company, “with the scale to invest in 5G, AI and digital services,” according to Telenor.
Telenor’s CEO, Benedicte Schilbred Fasmer (pictured above left), noted that, “Before the 2021 merger talks, our shareholding in Thailand was valued at NOK 12 billion. Today the value of our shareholding stands at some NOK 39 billion, based on the agreed sale price and the current exchange rate. Together with our partner True Corporation we have established market leadership in Thailand while also generating shareholder value.”
The transaction price of THB 11.70 per share represents a 36% increase to the closing price for the first trading day of True Corporation after the merger in March 2023, and a 4% premium to the last three months’ volume weighted average share price.
Two divestments in Asia
Telenor Group’s strategy is, as Schilbred Fasmer put it at the operator’s Capital Markets Day last November, “structural value creation opportunities in Asia”. It sold Telenor Pakistan in December and with “the agreement to sell our shares in True we have taken big steps in delivering on that strategy”, she said.
Telenor expects the sale of True shares to contribute to its stated goal of increasing the return on capital employed. The transaction also underpins Telenor’s goal of evolving into “a more Nordic-centric provider of secure connectivity over time”.
In its November earnings report for Q3, Telenor Group reported Telenor “solid performance in the Nordics, while facing headwinds in Asia”.
Two remaining holdings
Telenor still holds a 55.8% stake in Bangladesh’s Grameenphone, which was its first venture into an Asian market in 1997. It also has a 33.1% stake in CelcomDigi Berhad in Malaysia, which is the country’s largest mobile operator, after a merger in late 2022. However, it has been plagued with controversies in the last couple of years, with customers complaining about fraudulent transactions, poor serive after the merger and an arbitration claim from a vendor for RM72.6 million (about €15.45 million).
Two comments on the sale of True
Schilbred Fasmer, CEO of Telenor, said, “We are pleased to have reached an agreement with Arise about the sale of our stake in True and I would also like to extend a special thanks to True’s employees and customers. We are confident that the engaged people in True will continue to grow and innovate for its around 60 million customers.”
Khun Suphachai Chearavanont, owner of Arise, commented, “We are committed to sustaining our positive momentum, delivering profitable growth and value creation in True in the years ahead. We appreciate the close cooperation we’ve had with Telenor in signing the definitive agreements
